Why Uganda chose Tanzania over Kenya

A report authored by technocrats at the Energy Ministry’s Petroleum Directorate chose the Tanzania route for Uganda’s oil pipeline to the Indian ocean, Oil in Uganda has learnt.

The terms agreed upon by Tanzania’s President John Pombe Magufuli and his Ugandan counterpart are still unknown. However, there have been unconfirmed reports from Uganda and Tanzania that the two had discussed the possibility of waiving transit tariffs for some years.

Dated April 11, 2016 the report, titled: ‘Uganda Export Route: Report on Evaluation of Ports and Routes based on Studies and Due Diligence 2016,’ assessed the Kabaale-Lamu and Kabaale-Tanga routes in terms of their constructability, ruggedness, environmental issues and availability to support the infrastructure.

“Tanga is fully operational; Lamu port is to be constructed. Tanga port is naturally deep while Lamu is shallow and requires dredging” the report reads in part, before concluding that the Tanga route is the least cost option for transporting crude to the East African coast.

Another consideration according to the report is that Kabaale- Tanga route is generally flat for over 1,239 kilometers with few slopes and presents the lowest environmental footprint. The Lamu port was also found to have a lot of environmental concerns. “Due to international environmental sensitivity, the project is likely to face unacceptable reputation risks for investors and lenders,” the report reads.

The report adds that the Lamu port still has a lot of problems and the attendant costs would be enormous for the parties involved. First, the port is exposed to the south east waves over the banks, with the surrounding islands of Lamu, Manda, Mwamba, Chongoi and Pate unable to shelter it. In comparison, Pemba Island shelters Tanga bay from the South East monsoon, reducing the wave heights to less than 1 meter.

The technocrats also raised concerns on land compensation along the Lamu route. The report said that from past experiences, it took Kenya more than two years to compensate people and pave way for a particular development project while Tanzania needed only nine months to avail land for development. It notes that there is a smooth and well established land acquisition process in Tanzania that allows to shorten the project execution. A considerable portion of the Tanga pipeline (about 500 Km) will be on road reserve meaning that the land compensation bill will be much lowered.

The report concludes by recommending the Tanzanian route because it “Provides the most economic and robust option for the transportation of crude oil from the Albertine Graben to the East African coast.”